UK companies show little distinction between freelancers and permanent employees

23-Aug-2018

UK businesses are also champions in offering specific training courses for freelancers

Because of the continued labour market shortages, companies are finding it increasingly difficult to find suitable employees. That is one of the reasons why 95% of companies use freelancers, who can be deployed quickly and flexibly. Just over one in three (35.9%) UK companies have adapted HR policies for freelancers and more than half (54.5%) provide specific company training courses for freelancers.

According to an international survey by SD Worx, a leading provider of global Payroll & HR services, and the Antwerp Management School, UK companies make more effort to integrate freelancers into the corporate culture compared with businesses in Germany, France, the Netherlands and Belgium.

Four in ten UK companies (41.9%) do not make a distinction between permanent employees and freelancers in their HR policy. This percentage is even higher in some European countries (see table). Over one in five UK organisations (22.2%) have an HR policy only for permanent employees, and 35.9% have developed a separate HR policy for freelancers.

UKBEDEFRNLAverage

HR policy only for payroll personnel22.2%33.8%20.1%27.0%24.0%24.5%
No difference between payroll personnel 41.9%37.5%42.8%38.2%50.4%42.3%and freelancers in terms of HR policy

Separate HR policy for freelancers 35.9%28.8%37.1%34.9%25.6%33.2%

UK companies are champions in specific training courses for freelancers
The survey revealed that more than half of UK companies (54.5%) provide specific training courses for freelancers. This puts the United Kingdom in first place, with numbers being significantly lower for the other countries surveyed: 49.3% in France, 47.8% in Germany, 34.4% in the Netherlands and 38.8% in Belgium.

Furthermore, the survey identified that many UK companies (70.1%) assess freelancers in the same way as their permanent personnel. The average is much lower in the other countries in the survey (55.1%) with Belgium having the lowest percentage (37.5%). The same applies to feedback on performance. Three quarters (74.9%) of UK companies make no distinction in the process between permanent employees and freelancers. In the other countries, this percentage is lower (Germany 72.3%, France 70.4%, the Netherlands 65.6% and Belgium 53.2%).

Traditionally, an HR Policy is associated with the conventional employer-employee relationship, whereas freelancers are usually not subject to the same rules as permanent employees. Generally speaking, freelancers have more freedom to organise their work and working hours than permanent employees. However, the context is changing: the boundaries between employees and self-employed are fading and more and more companies are using freelancers.

UK freelancers are an important part of the team and corporate culture
Seven in ten UK companies (70.1%) try to integrate freelancers in their own corporate culture and processes. This means that the United Kingdom has the second highest score of all the countries in the survey (65.6% on average), after France (70.4%). Freelancers are also very much involved in activities for permanent personnel, such as company parties (71.3%), and are kept informed of what is going on in the organisation (76.6%), particularly when it concerns their work.

Fiona McKee, head of HR for SD Worx UK & Ireland, said:

“Whilst the survey revealed a positive trend in terms of inclusiveness and encouraging a good cultural fit when engaging freelancers, there are risks attached to this approach; the desire of the employer to have a one team approach and inclusiveness, is to be commended. However, in practice this can be more difficult to implement and must be treated with some caution. The main risk of such an approach would be the freelancer’s ability to make a future claim for employment status at an employment tribunal.

“A recent notable case was Gary Smith v Pimlico Plumbers, where Smith claimed he was an employee rather than a freelancer, as he was originally appointed. Employers may start to see more claims from individuals with regard to employment status as we move towards the gig economy, where more and more workers are engaged on short term assignments. As such we would always recommend that employers seek advice when developing HR policies which will be relevant for freelancers, to protect against future claims."